Gulf Oil Spill: Sending Beach House Renters to Texas?

Could the massive oil spill in the Gulf of Mexico boost Texas coastal real estate? The damaged BP rig in the Gulf of Mexico is gushing thousands of barrels a day, which could hit Florida's Gulf Coast just in time for Memorial Day, one of northwest Florida's busiest holidays.

Florida Gov. Charlie Crist extended a state of emergency to a handful of coastal counties. Meanwhile developers of the state's "designer beaches" on the "Emerald Coast" known for it's sparkling-clean waters and white-sand beaches, have made major cleanup plans.

BP cleanup crews already have canvassed the beaches and are standing by in case the mess washes ashore.
The latest projections say there's no imminent threat of the spill affecting Louisiana, Mississippi or Florida; the National Oceanic and Atmospheric Administration is pondering just what's keeping the spill away from the coast thus far -- perhaps the Mississippi River outflow? But the biggest mess could be for coastal property owners and The St. Joe Co., which owns 578,000 acres in the Florida panhandle and is the Panhandle's largest land-developer.

As the spill spread, St. Joe saw it's corporate shares sink. One major shareholder said St. Joe was "getting killed" by the oil spill, a declaration that may have contributed to a decision to stay mum to the press and direct questions to their website. On May 12, St. Joe's Watercolor Inn & Resort resort sent out a letter encouraging renters to enjoy the still-pristine beaches, but offering full refunds should the shoreline be negatively affected.

"At this time we are not really commenting on the oil spill," says St. Joe spokesman James McCusker. "I can tell you our beaches have not yet been impacted."

The timing of the spill is terrible for St. Joe, which just put the finishing touches on the new Northwest Florida Beaches International Airport, an environmental controversy in itself. Scheduled to open May 23 in Panama City Beach, it will be the first international airport built in the U.S. since 1995, when Denver International was built.

It boasts a 10,000-foot-long runway. New York's LaGuardia, by comparison, has two 7,000-foot runways.

The developers fought a long, hard battle to bring in low-cost carrier Southwest Airlines. Since the airport is backed by a major Florida landowner, it is part of a huge plan to put northwest Florida on the map as a national and international vacation and real estate destination.

If you build it, will they come? As St. Joe's president and chief executive told The New York Times: "Silicon Valley at one point was out in the middle of nowhere, too."

But Silicon Valley didn't have the worst oil spill in U.S. history to contend with.

Southwest Airlines said they have no plans to cancel any of the flights scheduled for May 23, and the planes have robust passenger lists. But people who own vacation homes in the area wonder who will be on those planes; many of their renters have canceled reservations.

Maggie Greenwood-Robinson of Flower Mound, Texas, owns two beach-front properties -- one on Texas' Gulf Coast and one in Destin, Fla. that is currently on the market. Sales have been slow, but this summer, she says, she has had more rental bookings than ever. She did get a letter from her property management company, Ocean Reef, notifying owners of several vacation rental cancellations due to the oil spill. Should that trend become widespread, Ocean Reef said, it planned to hire an attorney to sue BP for damages.

"This hits pretty close to home, " says Greenwood-Robinson. "I'm now firmly against offshore drilling. Knowing that it can ruin some of the world's most beautiful beaches is just horrifying."

Those who don't want to risk the oil spill ruining their vacation are heading elsewhere, which is why Florida's loss could be Texas' real estate gain.

Cinnamon Shore in Port Arkansas, Texas, a quaint fishing village about 35 minutes south of Corpus Christi, reports one to three calls per day for rentals, as vacationers redirect their travel to the Texas instead of Florida's panhandle. The "new urbanism" seaside development is strongly patterned after Florida's Seaside and WaterColor communities, where developers have preserved the beach dunes and built maximum three-story tall structures away from the beach, to disrupt as little as possible.

When oil mixes with saltwater and sunshine, it creates sticky, gunky tar balls (left) which wash up onto beaches and adhere to rocks, plants, marine life and skin.

Tar balls can be as small as grapes or as large as grapefruits.

"You can get them on your feet," says Lee Ann Peters, Director of Sales at Cinnamon Shores. She advises residents to use baby-oil-soaked wipes on their feet if they come into contact with tar balls. Peters has seen tar balls twice on Texas beaches, but it has never kept her out of the water.

And those who have grown up swimming in the Texas Gulf say tar balls are common on Texas beaches. Dallas-based developer Peter Dauterman has owned property all along the Gulf coast, and remembers surfing in Galveston as a teenager -- right along with the tar balls.